Use the following equations for Aggregate Demand and Short Run Aggregate Supply to answer this question:

If the Federal Reserve wishes to avoid short-run increases in the unemployment rate, the correct response to a negative AD shock would be:

You lend your little brother money for a year at a nominal interest rate of 10% based on your expectation that inflation will be 10% (after all, he is your little brother). The inflation rate however, turns out to actually be 15%. As a result,

The fiscal multiplier concept is important because it shows:

In a small economy, the rate of money growth for the current year is 8% and velocity of money circulation is stable (it’s growth rate is zero). If inflation is 4%, what is the growth rate of Real GDP according to the quantity theory of money?

The Lender of Last Resort characteristic of the Fed:

If a $500 increase in the monetary base ultimately leads to a $2,000 increase in the money supply (M1 or M2), then the money multiplier is:

The money you pay into Social Security goes to:

A decrease in the banking system’s willingness to lend will cause the reserve ratio to                , and the money multiplier to                .

You are Rigoberto Sanchez, an epidemiologist from Spain with a love of Harley Davidson motorcycles and s’more recipes that use exotic chocolate. You are tasked by the European Centre for Disease Prevention and Control to calculate the R0 for the Spanish Flu. Using data from several countries you estimate a value of 2 to 3. You are asked to explain this number, so you say,